Market Trends of Asia Pacific Tank Protection Industry
Increase investment in the oilfield exploration will drive the market
- Oil storage tanks hold crude oil and other raw materials during the refining and processing processes. They are also used to keep finished products. Stainless steel, carbon steel, reinforced concrete, and industrial plastic are among the materials used to make oil storage tanks. The targets set by countries to increase production to meet oil demand in various sectors is the major factor that is expected to increase the Asia Pacific tank protection market.
- For instance, in June 2022, ONGC announced that the company expects to increase 25% natural gas and 11 % in crude oil production in India after newer discoveries in western and eastern offshore. The company will spend Rs 31,000 crore from 2022 to 2025 on the exploration and add approx 1,00,000 square kilometers of new exploration area annually up to 2024-25.
- In India, the government has taken a strategic initiative to increase the share of the chemical sector in the country's GDP. According to the Department of Chemicals and Petrochemicals, the chemical sector in India was valued at USD 178 billion in 2020, which is targeted to increase to USD 300 billion by 2025. This is likely to promulgate the development of infrastructure associated with chemical and petrochemical production, which is expected to drive the demand for tank protection systems during the forecast period.
- In China, a total of 9 upcoming refineries are expected to start operations between 2020 and 2024. Among these, five are planned refineries, and four are announced refineries. The Jieyang refinery is likely to be the major upcoming refinery in China, with a refining capacity of 400 mbd. It is expected to start operations in 2022. These projects are likely to increase an investment in the oil and gas sector in the country.
- According to BP statistical review, in 2021, oil refinery throughput was 29,587 thousand barrels per day in Asia pacific and saw an increase from 26,855 thousand barrels per day in 2015. This shows that the government is investing in the oil and gas sectors, which will drive the market of tank protection during the forecast period.
- Hence, owing to the above points, increasing investment in the oil and gas sector will drive the market during the forecast period.
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China fastest growing region in the Tank protection market
- In March 2022, China Petroleum & Chemical Corp announced it to spend CNY 198 billion in 2022, more than 18% from 2020, which was higher than that of the 2013 investment record of CNY 181.7 billion. Out of this, the company plans to invest CNY 81.5 billion in upstream exploitation. This will lead to increase investment in the oil and gas sector.
- In 2021, China will be one of the major countries in the world, which will lead to growth in LNG demand. In 2020, about 12 million tons of LNG were imported; in 2021, there were 79 million tons. Due to this surge in demand, China surpassed Japan to take the top spot among LNG importers worldwide. Demand has increased due to Chinese LNG buyers signing long-term contracts for more than 20 million tons annually.
- Additionally, in 2021, China's refinery capacity reached an all-time high of 16.69 Mb/d. As the oil demand growth shifted from fuel-driven to petrochemical feedstock-driven, the country is transforming and upgrading the refinery industry.
- In January 2022, CNOOC announced net production estimated targets for 2023 are 640 million to 650 million barrels and for 2024 is 680 million to 690 million barrels of oil.
- Hence, with the expansion of the refinery and petrochemical business and the upcoming project, the country is expected to witness an increase in the demand for tank protection markets.
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